East Penn approves budget with no tax hike

The school board will put the spending plan to a final vote next month.

May 14, 2013|By Patrick Lester, Of The Morning Call

Property owners in the East Penn School District will be spared a property tax increase next school year under a $130 million proposed final 2013-14 budget approved Monday night.

"I want to make it clear, this is a zero percent tax increase," school board President Chuck Ballard said. "No tax increase."

Although the board must still put the spending plan to a final vote next month, school officials indicated the planned tax rate for next school year — 16.129 mills — will remain unchanged in the final plan.

A mill is a $1 tax on every $1,000 of a property's assessed value.

The tax rate — the current rate is 46.75 mills — will change significantly next school year due to Lehigh County's reassessment, but the revenue the school district receives from the property tax will remain unchanged from 2012-13.

Homeowners with properties assessed at $250,000 will pay $4,032 in property taxes next school year, unofficial calculations show.

Because of the countywide reassessment, some homeowners will see changes in their tax bills based on their new assessment.

The school district's plan to hold the line on taxes is part of a trend of declining tax hikes in the district over the past several years. This school year, the district approved a 1.3 percent increase. That was down from 1.83 percent during the 2011-12 school year and 3.85 percent for the 2010-11 school year.

"This district always tries to do right by the taxpayers," Ballard said. "Sometimes, it's not as nice as we would like, but we try our best to keep these [tax hikes] down."

School directors praised the administration for giving them a budget that holds the line on taxes.

"We are sitting next to school districts that are making horrific, horrific decisions," School Director Francee Fuller said. "We're able to preserve our staff. It is because of the great stewardship of our administration."

The $130 million budget represents a 4.1 percent spending increase over the current school year's budget, according to school district figures.

The district expects to generate about $77.5 million from real estate taxes, $8.3 million from earned income taxes and $1.3 million from real estate transfer taxes. East Penn is anticipating a basic subsidy of about $10.6 million from the state.

Employee salaries and benefits, which amount for the biggest chunk of spending, are expected to cost the district about $81 million in 2013-14.

The school district plans to add a high school biology teacher, an elementary schoolteacher, a special education teacher and a speech therapist. The budget eliminates one high school librarian position through attrition.

In a report to the school board, Superintendent Thomas Seidenberger noted a number of "positive" influences that allowed the district to avoid a tax increase. Among them were better-than-expected results from bond refinancing sales, unexpected midyear retirements by district employees and the fact that a number of students at Seven Generations Charter School have returned to East Penn schools.

Meanwhile, district officials say that there are signs that enrollment will grow in the coming years. There are also indications that the district's commercial tax base will expand if plans for a $140 million Hamilton Crossings shopping center in Lower Macungie Township materialize.

On Monday night, the school board approved a Tax Increment Financing proposal for the shopping center that would allow taxes from the property to be used to finance the development.

Lehigh County commissioners and Lower Macungie commissioners must still vote on the proposal.

The board is expected to put the budget to a final vote at its June 24 meeting.